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Oil & Platinum Prices Fall on Europe

Crude oil erased its earlier advance today on worries that the European sovereign-debt crisis is spreading. Egan-Jones Ratings Co. cut Spain’s credit rating today. Spain is likely to be the second European country, following Greece, that would require a bailout. Earlier, oil rose on hopes that Greece will remain in the eurozone and on tension about Iran. July futures for delivery of crude oil dropped $0.23 (0.3 percent) to $90.63 per barrel by 13:09 on NYMEX. Brent grade of oil declined from $107.25 to $106.83 per barrel as of 17:55 GMT on ICE today.

Platinum also fell today, but it may yet rebound in the near future as diminished supply trails growing demand. Supply of the precious metals is decreasing as labor strikes and safety concerns were disrupting mining in South Africa. Barclays Plc estimated that production will drop 4 percent to 6.14 million ounces this year. The annual surplus will shrink by 90 percent to 37,000 ounces, as a result. At the same time, car sales may reach a record this year. Automobile industry consumes a significant portion of global platinum output. On the other hand, some analysts say that demand for cars should wane as the global economic growth slows. Whatever the future hold for platinum, today the metal dropped, following two days of gains. Platinum was down from $1,439.70 to $1,426.00 per ounce today on COMEX.
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